UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2020

or

☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from                      to                      

Commission File Number 001-35392

RADIANT LOGISTICS, INC.

(Exact name of registrant as specified in its charter)

Delaware	04-3625550
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

405 114^th Avenue S.E., Third Floor

Bellevue, Washington 98004

(Address of principal executive offices) (Zip Code)

(425) 943-4599

(Registrant’s telephone number, including area code)

N/A

(Former name, former address, and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $.001 Par Value	RLGT	NYSE American

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No   ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☒
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No   ☒

There were 49,395,639 shares outstanding of the registrant’s common stock as of May 1, 2020.

RADIANT LOGISTICS, INC.

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)
	Condensed Consolidated Balance Sheets as of March 31, 2020 and June 30, 2019	3
	Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended March 31, 2020 and 2019	4
	Condensed Consolidated Statements of Changes in Equity for the three and nine months ended March 31, 2020 and 2019	5
	Condensed Consolidated Statements of Cash Flows for the nine months ended March 31, 2020 and 2019	7
	Notes to Condensed Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	30
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	41
Item 4.	Controls and Procedures	41
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	42
Item 1A.	Risk Factors	42
Item 2.	Unregistered Sale of Equity Securities and Use of Proceeds	42
Item 6.	Exhibits	44
Signatures		46

2

RADIANT LOGISTICS, INC.

Condensed Consolidated Balance Sheets

	March 31,			June 30,
		2020		2019
(In thousands, except share and per share data)	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	16,697		$	5,420
Accounts receivable, net of allowance of $1,683 and $1,887, respectively		93,021			93,123
Contract assets		15,754			17,777
Income tax receivable		806			506
Prepaid expenses and other current assets		15,886			8,066
Total current assets		142,164			124,892
Property, technology, and equipment, net		19,684			20,127
Goodwill		72,078			65,389
Intangible assets, net		53,845			55,742
Operating lease right-of-use assets		12,610			—
Deposits and other assets		4,004			1,560
Total other long-term assets		142,537			122,691
Total assets	$	304,385		$	267,710
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	66,687		$	74,097
Operating partner commissions payable		10,391			12,891
Accrued expenses		6,339			6,224
Current portion of notes payable		3,609			3,687
Current portion of operating lease liability		6,476			—
Current portion of finance lease liability		686			683
Other current liabilities		1,471			840
Total current liabilities		95,659			98,422
Notes payable, net of current portion		58,619			30,047
Operating lease liability, net of current portion		6,862			—
Finance lease liability, net of current portion		2,668			3,161
Deferred income taxes		6,301			7,838
Deferred rent liability		—			862
Other long-term liabilities		1,810			100
Total long-term liabilities		76,260			42,008
Total liabilities		171,919			140,430
Commitments and contingencies (Note 15)
Stockholders' equity:
Common stock, $0.001 par value, 100,000,000 shares authorized; 50,028,486 and 49,678,262     shares issued, and 49,395,639 and 49,586,464 shares outstanding, respectively		31			31
Additional paid-in capital		101,324			100,186
Treasury stock, at cost, 632,847 and 91,798 shares, respectively		(2,749	)		(253	)
Retained earnings		32,758			26,883
Accumulated other comprehensive income		864			187
Total Radiant Logistics, Inc. stockholders’ equity		132,228			127,034
Non-controlling interest		238			246
Total equity		132,466			127,280
Total liabilities and equity	$	304,385		$	267,710

The accompanying notes are an integral part of these condensed consolidated financial statements.

3

RADIANT LOGISTICS, INC.

Condensed Consolidated Statements of Comprehensive Income

(unaudited)

	Three Months Ended March 31,						Nine Months Ended March 31,
(In thousands, except share and per share data)		2020			2019		2020			2019
Revenues	$	177,221		$	206,048		$	579,691		$	685,868
Operating expenses:
Cost of transportation and other services		129,440			153,302			420,419			514,293
Operating partner commissions		20,352			23,125			69,899			76,309
Personnel costs		14,412			14,806			44,487			45,256
Selling, general and administrative expenses		8,027			6,812			22,370			21,458
Depreciation and amortization		4,282			3,847			12,413			11,295
Transition, lease termination, and other costs		—			—			328			(11	)
Change in fair value of contingent consideration		3			(611	)		52			(1,182	)
Total operating expenses		176,516			201,281			569,968			667,418
Income from operations		705			4,767			9,723			18,450
Other income (expense):
Interest income		17			13			50			37
Interest expense		(752	)		(684	)		(2,070	)		(2,345	)
Foreign currency transaction gain (loss)		169			(24	)		120			169
Other		89			49			164			258
Total other expense		(477	)		(646	)		(1,736	)		(1,881	)
Income before income taxes		228			4,121			7,987			16,569
Income tax expense		(102	)		(942	)		(1,850	)		(3,793	)
Net income		126			3,179			6,137			12,776
Less: net income attributable to non-controlling interest		(73	)		(247	)		(262	)		(891	)
Net income attributable to Radiant Logistics, Inc.		53			2,932			5,875			11,885
Less: preferred stock dividends		—			—			—			(956	)
Less: issuance costs for preferred stock redemption		—			—			—			(1,659	)
Net income attributable to common stockholders	$	53		$	2,932		$	5,875		$	9,270
Other comprehensive income:
Foreign currency translation gain (loss)		711			(278	)		677			215
Comprehensive income	$	837		$	2,901		$	6,814		$	12,991
Income per share attributable to common stockholders:
Basic	$	—		$	0.06		$	0.12		$	0.19
Diluted	$	—		$	0.06		$	0.11		$	0.18
Weighted average common shares outstanding:
Basic		49,577,370			49,515,717			49,667,243			49,471,556
Diluted		50,974,994			51,169,321			51,266,348			50,979,319

The accompanying notes are an integral part of these condensed consolidated financial statements.

4

RADIANT LOGISTICS, INC.

Condensed Consolidated Statements of Changes in Equity

(unaudited)

	RADIANT LOGISTICS, INC. STOCKHOLDERS' EQUITY
(In thousands, except share and per share data)	Preferred Stock				Common Stock				Additional Paid-in			Treasury			Retained		Accumulated Other Comprehensive		Total Radiant Logistics, Inc. Stockholders'			Non- Controlling			Total
	Shares		Amount		Shares		Amount		Capital			Stock			Earnings		Income (Loss)		Equity			Interest			Equity
Balance as of June 30, 2019		—	$	—		49,586,464	$	31	$	100,186		$	(253	)	$	26,883	$	187	$	127,034		$	246		$	127,280
Issuance of common stock upon vesting of     restricted stock awards, net of taxes withheld     and paid		—		—		138,147		—		(314	)		—			—		—		(314	)		—			(314	)
Issuance of common stock upon exercise of stock     options, net of taxes withheld and paid		—		—		82,627		—		(146	)		—			—		—		(146	)		—			(146	)
Distribution to non-controlling interest		—		—		—		—		—			—			—		—		—			(180	)		(180	)
Share-based compensation		—		—		—		—		430			—			—		—		430			—			430
Net income		—		—		—		—		—			—			3,235		—		3,235			96			3,331
Other comprehensive income		—		—		—		—		—			—			—		114		114			—			114
Balance as of September 30, 2019		—	$	—		49,807,238	$	31	$	100,156		$	(253	)	$	30,118	$	301	$	130,353		$	162		$	130,515